The Sale Fell Through After the Work Was Done

Why this matters

When a sale dies, everybody's money goes back where it came from except yours. The buyer gets the earnest money back or fights for it, the seller keeps the house, and the agents get nothing. The repair you finished last week has no column to come out of, and the first thing you will hear is some version of "that was the buyer's requirement" or "the agent told you to do that." Whether you get paid now depends on three things you can no longer change: who signed, what the payment terms said, and how many days are left on your lien clock. So the work is reading the record you already have, quickly, before the clock decides for you.

This is one case, reconstructed from the job file the way the office manager had to reconstruct it. The setup side, which would have prevented most of it, lives in Getting Paid at Closing Without Getting Stuck.

The record as the office found it

A four-person electrical shop. The buyer's inspector flagged the panel in a listed 1960s ranch: a fused panel with signs of overheating at two fuse holders, "recommend replacement by a licensed electrician." The buyer's repair request asked the seller to replace it. The office manager pulled this from the job file on day 18, two days after the listing agent called to say the deal was off:

JOB 5531  Panel replacement, 77 Birch Ln
day 0  Text from listing agent: "seller ok's
       the panel, can you do it this week?"
day 1  Quote sent to agent. Terms: "payable
       at closing." Signed: agent, "for seller"
day 2  Agent forwards seller email: "Fine, do
       the panel if it gets us to closing."
day 3  Permit pulled
day 8  Work complete, 9.0 hrs, 2 techs
day 11 Final inspection passed
day 12 Invoice + quote emailed to title co.
       No seller payment authorization.
day 16 Agent: buyer's loan denied, deal off
day 17 Seller: "the buyer wanted it, I never
       agreed to pay unless it closed"

Three questions settle a file like this, in this order, because each answer limits the next one.

Question 1: who authorized the work

The signature on the quote is the agent's. "For seller" next to an agent's name says the agent believed they were acting for the seller. Whether that bound the seller depends on the listing agreement and on your state's law of agency, and that is a question for an attorney, not one the office can answer by reading the quote harder.

The forwarded email is the seller's own words, and they cut both ways. "Fine, do the panel" is approval of the work in the owner's voice, which is the strongest thing in the file. "If it gets us to closing" can be read as the reason for agreeing, or as a condition on paying. The seller's position on day 17 is the second reading. The shop's is the first. Neither side is obviously right, and the office manager's job was not to win that argument on the phone but to recognize that it was the argument.

What the record does not contain is just as telling. There is no seller signature, no payment authorization to the title company, and nothing saying when payment is due if there is no closing. Every one of those absences pushes toward the seller's reading.

The finding. The work was authorized by the owner in writing, through a forwarded email, with an ambiguous condition attached. That is enough to send an invoice and a demand. It is not enough to be sure of winning.

Question 2: who owes it now

Not the buyer. The buyer asked for the repair in a contract with the seller. The shop had no contract with the buyer, and the buyer never owned the house. Chasing the buyer is wasted effort and sometimes a dangerous one, because it reads as harassment of someone with no obligation.

Not the title company. Escrow holds funds for a closing. No closing, no funds, and in any case there was never a seller instruction to pay the shop. The invoice emailed on day 12 was a notice, not a claim.

Possibly the agent, but probably not the first stop. If the agent signed without authority, some states let a contractor pursue the agent. That is a lawsuit against someone who sends you work, and an attorney decision.

The seller. The seller owns a house with a new, permitted, inspected panel in it. That improvement stays with the property and will help the next sale. The shop's claim is against the seller under the approval in the email, and against the property through a lien.

Question 3: the lien and its clocks

A mechanics' lien is a claim recorded against the property for unpaid work that improved it. It does not need a sale to exist; it follows the house. What it does need is to be made on time, and every state sets its own clocks, so the first call is to find yours, not to assume this example's.

The shop was in a state whose rules ran like California's: a direct contractor (one hired by the owner) had 90 days after completing the work to record the lien when no notice of completion was recorded, and then 90 days after recording to file suit to enforce it, or the lien expires. Other states differ sharply. Florida also allows 90 days from final furnishing to record, but gives a year to enforce. Some states require a notice to the owner before or soon after work starts, and a lien is unavailable if it was not sent. Texas puts extra conditions on homestead property, including a written contract signed before work begins. Many states bar an unlicensed contractor from liening at all.

Which day starts the clock matters. For this shop it was day 8, completion, not day 11, the final inspection, and not day 16, when the deal died. A shop that starts counting on the day it learns the sale failed has already lost a week.

The office manager's count on day 18: 90 days from day 8 is day 98. Ten days used, 80 left to record.

Whether to lien at all is its own call. A lien costs attorney time to draft and record correctly, and it lands on a seller who is also, often, the listing agent's client for the relisting. On this job the invoice covered 9.0 technician hours plus a panel and breakers, large enough to justify the attorney. On a 2-hour drain repair the proportionate route is usually a demand letter and then small claims court against the seller, where the dollar limit and the rules on representation vary by state. The deciding facts are the size of the invoice against the cost of protecting it, whether the owner is likely to sell again soon (short of a lawsuit, a lien pays when title has to clear), and whether the agent who sent the job is worth keeping. Write the deadline down either way, so that not liening is a choice and not something the calendar made for you.

This is not legal advice. Liens are strict-compliance instruments: a wrong owner name, a wrong legal description or a late filing can void one, and in some states an overstated amount exposes the filer to penalties. Walk into the attorney's office with the job record above, the permit and final inspection, the quote, the forwarded email, and the property's legal description from the deed.

How it resolved

Day 20. The owner of the shop, not the office, called the seller. No argument about the condition; just facts: "The panel is in, permitted and passed. It stays with the house and it will help your next buyer. I'd like to settle this before I have to protect it with a lien." The seller repeated that the buyer should pay.

Day 30. The shop's attorney sent a demand letter quoting the seller's email, enclosing the invoice and the final inspection, and stating payment was due within 15 days.

Day 46. No payment. The attorney recorded the lien on day 70, inside the day 98 deadline, after confirming the owner names and legal description against the deed. Recording on day 70 set the enforcement deadline at day 160.

Day 112. The house was relisted and under contract again. The new buyer's title search found the lien, and the title company would not insure the sale until it was paid or bonded off.

Day 138. The seller authorized payment from proceeds at the second closing. The shop received the full invoice and recorded a lien release the same week, which the title company needed to close.

Reading the outcome. The shop was paid 130 days after completing the work, entirely because the lien was recorded in time and the house sold again. Had the second sale slipped past day 160, the shop would have had to file suit to keep the lien alive, or lose it. Had the seller decided not to sell, the lien would have sat on the title while the shop chose between suing and waiting. Neither outcome would have changed the work. Both were set by the record made in the first two days.

What the record should have held

The office rewrote its real-estate intake after this job. Four lines in the file would have changed the whole case:

• The seller's signature on the quote, or an email from the seller saying "approved, proceed with quote 5531." That removes Question 1.
• A backstop payment date: "at closing or within 30 days of completion, whichever first." That removes the "only if it closed" reading.
• A signed payment authorization to the title company, delivered with the invoice. That makes the original closing pay you if it happens.
• A lien-deadline date written on the job on the day work completes, so nobody starts counting late.

None of those adds more than a few minutes. Together they turn a four-month dispute into either a payment at closing or an ordinary overdue invoice. See related: The Real Estate Job Intake SOP.

One more lesson from the gaps. The day 12 invoice went to the title company with nothing attached that told them to pay. That step felt like progress and was not. If you send something to a closing office, send the thing they can act on.

References

• Your state's mechanics' lien statute, including notice, recording and enforcement deadlines
• Your state contractor licensing board, lien eligibility for licensed contractors
• See related: Getting Paid at Closing Without Getting Stuck
• See related: Quoting a Repair Request Under a Closing Deadline
• See related: The Real Estate Job Intake SOP